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Investment Structures
The investment asset is typically owned by a separate, single-purpose, limited liability company, whose managing member is the project sponsor. Investors are members of the owning limited liability company and have a pro rata ownership interest in that company based upon the amount of their investment.
Syndicators/Sponsors
Persons or companies selling equity interests in real estate or corporations to investors. The organizer or operator of a syndication is the catalyst who brings investors together and has the expertise to structure the syndication and supervise the operation. The Syndicators usually becomes the general partner, and any internal syndication agreements between the GP and limited partners (investors) cover a variety of items of potential conflict, including, but not limited to:
- Fees and benefits paid to or obtained by the syndicator
- The apportionment of cash flows, taxable income
- Reversion/sale proceeds
- Management control and costs
- Present and/or future equity requirements
- Buy-sell procedures
Accredited Investors
Investment opportunities with SINVP are often limited to investors who satisfy the definition of an "accredited investor" which the U.S. Securities and Exchange Commission has defined. As used in Regulation D [§§ 230.501], the following term shall have the meaning indicated: Accredited Investor. "Accredited investor" shall mean any person who comes within any of the following categories, or whom the issuer reasonably believes comes within any of the following categories, at the time of the sale of the securities to that person:
- Any natural person whose individual net worth, or joint net worth with that person's spouse, exceeds $1,000,000.
- Any natural person who had an individual income in excess of $200,000 in each of the two most recent years, or joint income with that person's spouse in excess of $300,000 in each of those years, and also has a reasonable expectation of reaching the same income level in the current year.
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